'MUHAMMAD SAJID MEHMOOD SETHI, J.--- This consolidated judgment shall dispose of instant writ petition along with following connected writ petition as common questions of law and facts are involved in these cases: 1.W.P. No,33103 of 2015. Haji Muhammad Nazir v. Province of Punjab through Secretary, Mines and Minerals, Punjab Lahore etc. 2.Brief facts, as stated in the writ petition, are that an Exploration License for rock salt, over an area of 501.13 acres near Dullewali in District Khushab, was granted to M/s. Pak Hamalia Salt Impex (Pvt.)
Limited/respondent No,2 under the Punjab Mining Concession Rules, 2002 (hereinafter "PMC Rules"), for a period of three years w.e.f, 18.12.2006, for establishing a Sodium Sulphate chemical plant by using rock salt as raw material. As per terms and conditions of the Exploration License, the licensee was not permitted to sell the rock salt in the open market. After completing the codal formalities respondent No,2 was permitted to start Exploration Work on 15.01.2007. Respondent No,2 complained on 17.01.2007 and 26.01.2007 to respondent No,1/Director General, Mines and Mineral, Punjab Licensing Authority, Lahore, that adjoining lessee of petitioner was working in its licensed area. After demarcation of the area, respondent No,1 issued a registered Show Cause Notice ("SCN") to the petitioner on 03.02.2007. In response, petitioner submitted an application dated 26.01.2007 to Secretary, Mines and Minerals, Punjab, Lahore/respondent No,3 requesting for cancellation of Exploration License of respondent No,2. Petitioner also submitted reply to the SCN of respondent No,1 on 19.02.2007, however, petitioner without awaiting any decision from respondent No,1 on the SCN, preferred an appeal before respondent No,3, against the issuance of SCN.
Meanwhile, on 26.04.2007, respondent No,2 applied to respondent No,1 for permission to access from petitioner's area. Respondent No,1 heard the concerted parties on 28.05.2007 and directed .Deputy Director Mines and Minerals, Khushab, to stop the illegal work of petitioner. Against the said order of respondent No,1, petitioner filed a petition before respondent No,3, which was remanded to respondent No,1 for hearing the case afresh. The respondent No,1 after obtaining written agreements from concerned parties passed a detailed order on 21.07.2007, against petitioner, which was again challenged before respondent No,3 on 28.08.2007. The appeal was finally heard on 06.09.2008, wherein respondent No,1 was directed to assess the quantity of rock salt unauthorizedly excavated by petitioner and to take action under the PMC Rules. Respondent No,2 submitted an application on 09.02.2008 requesting respondent No,3 that they might be allowed to excavate rock salt for selling in local as well as in the foreign market. Respondent No,3 held a meeting in this regard with respondent No,1 and Chief Inspector of Mines on 23.06.2008, and decided to call some technical expert from PCSIR for assistance in the matter. Accordingly, Principal Engineer, PCSIR Laboratory, attended the meeting on 14.10.2008, and it was decided that respondent No,2 might be allowed to excavate 3000 tons rock salt in total for analysis from Laboratory and feeding to pilot plant installed abroad, therefore, respondent No,1 allowed respondent No,2 to excavate 3000 tons of rock salt for sample testing abroad under rule 21(d) of PMC Rules ibid, vide letter dated 18.10.2008. However, respondent No,2 Was not allowed to sell the rock salt in local as well as foreign markets. Deputy Director, Mines and Minerals, Khushab, inspected the area on 30.06.2009, 10.09.2009, 09. 01. 2010, 11.06.2011 and 18.04.2012 and noticed that respondent No,2 committed the following violations:- (i)The respondent No,2 was excavating and selling the rock salt in the open market.
(ii)The respondent No,2 had not made any arrangement for installation of industrial plant at site so far, (iii)Respondent No,2 had sublet the area and did not issue any MD-8 challan (meant for keeping record of dispatched mineral).
(iv) The respondent No,2 indulged in unauthorized mining of rock salt and sold 14197 tons of rock salt from the area illegally.
'Therefore, SCNs were issued to respondent No,2 on 27.06.2009, 03.07.2009 and 16.11.2009. The replies submitted by respondent No,2 were thoroughly examined and found unsatisfactory, therefore, respondent No,2 was called upon for personal hearing before respondent No,1, who heard the case on 18.05.2012 and observed violations of the allotment letter dated 18.12.2006 as well as PMC Rules.
Moreover, respondent No,2 excavated and sold 14197 tons of rock salt from the area, which was duly verified from the reported drivage of mines and seams reported by respondent No,2 through Monthly Production Returns/ Quarterly Reports upto 31.10.2010. As respondent No,2 had already availed 06-Years period of the Exploration License and had not made alleged payment amounting to Rs,1,00,116/- and Rs,76,66,380/- despite demand notice issued to them on 10.04.2012, therefore, respondent No,1 rejected the application for renewal of Exploration License and cancellation letter was issued on 13.07.2012, whereas possession of the area was assumed by the Regional Office, Khusliab, on the same day, in favour of the Government. The said order was assailed before respondent No,3, who, vide order dated 09.07.2015, accepted the appeal. Petitioner has assailed the said order with the following prayer:- "Under the circumstances, it is very humbly prayed that the impugned order dated 09.07.2015 may kindly be set aside being without lawful authority and jurisdiction.
'It is further prayed this being a fit case may be remanded to the respondent No,3 for decision afresh along with revision petition of the petitioner."
3. Learned counsel for petitioner submits that the area in question is already a proved area which cannot be allotted on Exploration License. He has referred to Rule 76 of the PMC Rules, to submit that the proved area can only be allotted by auction. He further submits that according to the decision dated 18.05.2012, passed by respondent No,1, 'respondent No,2 is a defaulter. He adds that petitioner is owner of private land and it is already working (excavating and developing) in the disputed area. He further submits that petitioner has cleared its defaulter position in the year 2003 by decision of the Cabinet Division and thereafter, started the ventilation tunnel for quality and quantity of fresh air for safe working environment. He contends that the impugned order, even otherwise, is not sustainable for the reason that the point raised by respondent No,1 in his order dated 18.05.2012, has not been dealt with or touched by respondent No,3, thus the impugned order is not sustainable in the eye of law. In support of his submissions, learned counsel for petitioner has placed reliance upon Maulana Abdul Hague Baloch and others v. Government of Balochistan through Secretary Industries and Mineral Development and others (PLD 2013 Supreme Court 641).
4.On the other hand, learned counsel for respondent No,2 contends that respondent No,2 applied for the grant of Exploration License on 20.03.2006. After inspection of the area and submission of inspection report of the area on 27.04.2006, the Exploration License was granted to respondent No,2 on 18.12.2006 for three years. He adds that respondent No,2 started its working in the area and explored the mineral (Rock Salt) and submitted report of discovery of mineral with the .department on 27.06.2007. After discovery of the mineral, respondent No,2 was about to submit the application for grant of mining lease (conversion of license into lease) under Rule 48 (1) PMC Rules, but the petitioner started creating hurdles in the smooth working of respondent No,2 and started unauthorized mining in the granted area of respondent No,2 in the garb of their unauthorizedly installed ventilation tunnel by encroaching the area granted to respondent No,2. He further adds that respondent No,2 filed a complaint before respondent No,1, who passed an order dated 28.05.2007, against the petitioner, after hearing the parties. Petitioner preferred an appeal before respondent No,3, who, vide order dated 21.07.2007, remanded the case back to respondent No,
1. He further submits that petitioner does not have any locus standi to file the petition, neither it is aggrieved nor it was party to the appeal nor the order dated 09.07.2015, has been passed against it. He further submits that the area granted to respondent No,2 is not to be dealt with in terms of Rule 76 of PMC Rules, but with Rule 48 of the said Rules.
5.Arguments heard. Record perused.
6.In order to better appreciate the comparative arguments of learned counsel for the parties, it would be beneficial to reproduce the following provisions of the PMC Rules and Section 49 of the West Pakistan Land Revenue Act, 1967:--- "48. Exercise of power to grant or refuse application for mining lease. (1) Subject to these rules, where an application for the grant of a mining lease is made by the holder of an exploration license or a mineral deposit retention license, and the application.
(a) relates to an area of land in, or which constitutes, the exploration area or, as the case may be, the retention area; and (b). is in respect of any mineral or group of minerals;
(i) to which such exploration license relates; (ii) to which such mineral deposit retention license relates, the Licensing Authority shall grant the application."
"76. Competitive bids.-- The Licensing Authority may, when required by the Government to do so, invite competitive bids for the issue of an exploration license or a mining lease in respect of any area of land which is not subject to:-- (a)a reconnaissance license which gives the holder an exclusive right such as is referred to in rule 14 (3)
(b)an exploration license, a mining lease or a mineral deposit retention license or a prospecting license or a mining lease under small scale mining, or (c)an application for any such license or lease, and may, in accordance with these rules, issue the appropriate mineral title to the successful bidder."
"49. Notwithstanding anything to the contrary in any other law, or in any order or decree of Court or other authority, or in any rule of custom or usage, or in any contract, instrument, deed or other document, all mines and minerals shall be and shall always be deemed to have been the property of Government, and Government shall have all powers necessary for the proper enjoyment of its rights thereto."
7. The combined reading of the aforesaid provisions of law shows that the mines and minerals wherever they may be, belong to the Government and it constitutes a Government property as per the provisions of the Constitution, West Pakistan Land Revenue Act, 1967, and the PMC Rules ibid, therefore, the license or lease of the mines and minerals could only be given through public auction, and any allotment or assignment of exploration or lease as the case may be, without public auction, is absolutely illegal and without lawful authority and same is not .sustainable in the eye of law. Reliance can be placed upon Syeda Shahida Tasleein v. The Province of Punjab and others (PLD 1995 Lahore 110). Shaukat All v. Secretary, Industries and Mineral Development, Government of Punjab Lahore and 3 others (1995 MLD 123) Khalid Hassan v. Secretary to the Government of Balochistan and others (2001 YLR 2724), Malik Habibullah v. Province of the Punjab through Secretary Mines and Mineral Department, Lahore and 7 others (2006 CLC 1723), Haji Faiz Muhammad v. Mines Labour Welfare Commissioner and 5 others (2007 MLD 423), Ilyas Ali v.
Secretary Mines and Minerals Punjab, Lahore and 4 others (2011 YLR 186), Malik Sarfraz Khan v.
Secretary Government. of the Punjab Mines and Mineral Department and 2 others (2011 YLR 2268), Messrs Ghani Corporation through Chief Executive v. Government of N.-W.F.P. through Secretary Industries Commerce, Mineral Development and 5 others (PLD 2011 Peshawar 1), Major (Rtd.)
Baseer Ahmad Khattak v. Government of Khyber Pakhtunkhwa through Secretary Mineral Development Department, Peshawar and 2 others (2013 CLC 1108) and Fateh-ul-Mulk Ali Nasir and 4 others v. Government of Khyber Pakhtunkhwa through Secretary Mines and Minerals and 6 others (2015 CLC 1762).
8. Perusal of record also shows that respondent No,1, vide order dated 18.05.2012, cancelled the Exploration License of :respondent No,2 on the ground that pit mouth value of un-authorizedly excavated rock salt to the tune of 14197 metric toils at the rate of Rs,540/- per ton is liable to be recovered from respondent No,2 under the PMC Rules. It was also held by respondent No,1 that the area is proved, therefore, transparency required that the same should be granted through open auction under Rule 76 of the PMC Rules. The relevant observations of respondent No,1 in order dated 18.05.2012, read as under:- "(I) Request of M/s. Pak Hamalia Salt Impex (Pvt.) Ltd. for further renewal of the Exploration License is rejected under Rule 27(4-a and b) and cancel the Exploration License with immediate effect. The possession of the area shall be taken over by the Department with immediate effect.
(2) The pit mouth value of un-authorizedly excavated Rock Salt to the tune of 14197 metric tons at the rate of Rs,540/- per ton be recovered from the licensee under the rules, ibid. (3)The Guarantee worth Rs,5,00,000/- [Rupees Five Lakh only] is forfeited under clause xxiv of the allotment letter.
(4)The area is proved and therefore be transparently granted through open auction under Rule 76 of the Punjab Mining Concession Rules, 2002."
9. Respondent No,2 filed an appeal before respondent No,3 against the orders dated 18.05.2012 of respondent No,1. The appeal was heard by respondent No,3 on 09.07.2015 who accepted the appeal. The operative part of the order dated 09.07.2015 is reproduced hereunder:- "Arguments heard and record perused. It is observed that industrial production on any mineral/establishment of industrial plant cannot be achieved without stable mining operations, which in itself cannot achieve without authentic resource estimation leading to mine planning designing. It is also on record that M/s. PMDC (adjacent lessee) created hurdles in the exploration work of the appellant company during most of the exploration license period. As the Government is trying to facilitate investment in the mining sector, however the same time Mines and Minerals Department being the regulatory authority can only facilitate serious investors, therefore, the appellant company was advised vide this court order dated 21.04.2014 to submit a time based schedule along with irrevocable performance guarantee, which have already been duly submitted by appellant company, as admitted by departmental representative present in the court.
Therefore, in view, what has been discussed, I feel it appropriate in the interest of justice, to give another opportunity to the appellant company to complete the exploration work and meanwhile structure investment for the installation of chemical plant. Accordingly, the exploration license of the appellant company hereby stands restored for a further period of three years. However the exploration license will stand cancelled on the first breach of committed time base schedule and the performance guarantee will stand forfeited in favour of the department. Consequently the request of Olympia Chemicals to allow the excavation of rock salt on the royalty basis from the cancelled area of appellant company is also hereby turned down, as the same is not possible under any provision of the Punjab Mining Concession Rule, 2002. Regarding the assessment made against the appellant company on account of unauthorized excavation rock 'salt, the matter is referred to Licensing Authority for decision afresh, keeping in view fact that PMDC was found involved in the unauthorized excavation of rock salt from the licensed area of the appellant company."
10. Examination of the impugned order indicates that respondent No,3 gave another opportunity to respondent No,2 to complete the exploration work and structure investment for installation of chemical plant and consequently, the Exploration License of respondent .No,2 was restored for a further period of three years without holding public auction and without asking it to deposit the assessed amount, which was referred back to the Licensing Authority for decision afresh. It has also been noted that without affording an opportunity to the petitioner, it Was held that petitioner was found involved in unauthorized excavation of the rock salt from the licensed area of the respondent-company. Petitioner, in circumstances, has been condemned unheard, thus it is an aggrieved person within the contemplation of Article 199 of the Constitution of the Islamic Republic of Pakistan, 1973 ("Constitution").
11.It is also relevant to observe here that respondent No,3 has absolutely ignored the noted sections of law and the findings recorded by respondent No,1 in the order impugned before him. Therefore, impugned order is not sustainable within the contemplation of the provisions of the Section 24-A of the General Clauses Act, 1897, Articles 4 and 5 of the Constitution, as it failed to attend to the reasoning of the forum below of respondent No,
1. Reliance in this regard is placed upon Adam'ee Jute Mills Ltd. v. The Province of East Pakistan and others (PLD 1959 SC (Pak.) 272), Gouranga Mohan Sikdar v. The Controller, Import and Export and 2 others (PLD 1970 SC 158), Mollah Ejahar Ali v.
Government of East Pakistan and others (PLD 1970 SC 173), Muhammad Ibrahim Khan v. Secretary, Ministry of Labour and others (1984 SCMR 1014), Al-Hadayat Textile through Proprietor v. Soneri Bank Limited (2003 CLD 105) and Waqar Alam Saeed v. District Coordination Officer/Chairman and 3 others (2005 YLR 1742).
12. Resultantly, instant writ petition is allowed. The impugned order dated 09.07.2015 passed by respondent No,3 is declared to be illegal and without lawful authority, and matter is remitted to respondent No,3 to re-decide the same after hearing the petitioner and all concerned, through a speaking order, strictly in accordance with law, within a period of four weeks, under intimation to Deputy Registrar (Judl.) of this Court.